“Raids took place in residences and shops, mainly located in the greater Montreal, the Laurentians, Lanaudiere, Monteregie, and on Kahnawake in Quebec, as well as on Six Nations in Ontario.

“‘Project Mygale’ is the largest ever made to date in America on tobacco smuggling, but also on cross-border crime between Canada and the United States,”

said Capt. Frederick Gaudreau of the ‘Surete du Quebec’.

“Police said they have evidence showing that the alleged criminal organization imported 158 shipments, totaling 2,085,600 kilograms, of tobacco into Canada from the U.S. through the border crossings at Lacolle, Lansdowne and Fort Erie, for sale on Kahnawake and Six Nations.

“According to ‘Mohawk Council of Kahnawake’ and ‘Kahnawake Peacekeepers’, to their knowledge no raids‎ have been conducted on ‘their territory’.

{Even though the criminal activity centres on the reserves, because of Race Based Law the authorities won’t conduct the necessary raids there; so, this criminal activity will continue…}

“In what it called the largest raid of its kind in America, provincial police dismantled a drug, tobacco and money laundering ring on Wednesday that had roots in Quebec and reached as far as South America and Europe.

“While collaborating with more than a dozen municipal police forces, the operation led to more than 60 people being arrested — including the alleged head of the organization — and more than 70 search warrants being carried out.

“In total, police seized $13.5 million worth of tobacco, more than $3 million in U.S. cash, $1.5 million in Canadian cash and more than 800 kilograms of cocaine.

“This is the largest operation we’ve had to this day in connection to contraband tobacco, and also in cross-border crime between Canada and the United States,”

‘Sûreté du Québec’ chief Frédérick Gaudreau said in a statement.

“According to police, the network that was targeted had ties to both biker gangs and Aboriginal organized crime.

“Police allege the criminal organization imported 158 tobacco cargoes since August 2014, totalling more than 2 million kilograms and representing fraud of more than $530 million.

“THE MAJORITY OF IT WAS BEING SOLD IN KAHNAWAKE AND IN THE SIX NATIONS OF THE GRAND RIVER RESERVE IN ONTARIO, police said…

“As part of the investigation, there were four separate 12,000-kilogram tobacco shipments that were seized between the three border crossings in the last two years alone, said Dominic McNeely, a spokesperson with ‘Canada Border Services Agency’. The last shipment was seized this month. The agency had about 100 officers helping with the operation on Wednesday. “Police also allege that the organization was shipping drugs from Montreal to Detroit, and from South America into the United States. Police seized 21 kilograms of methamphetamine, 100 grams of fentanyl and 35 pounds of marijuana on Wednesday.

“As for the money laundering, police suggest money was being sent from Montreal to different places in the United States and South America, before ultimately heading toward Europe.

“The U.S. Immigration and Customs Enforcement was also involved in the operation, but would not comment on its involvement, in order to “protect the integrity of the investigations.”

“Locally, police said they made arrests and conducted raids on the North Shore of Montreal, in the Laurentians, in Lanaudière and in Kahnawake.

“Three of the alleged members of the criminal organization — including one of the higher-ups — handed themselves over to police in Kahnawake after collaborating with local ‘peacekeepers’.

“The arrest of three members of the Kahnawake Mohawk band presented the SQ with a few additional hurdles. Because the provincial police don’t have jurisdiction on the South Shore territory, they needed to cooperate with local ‘peacekeepers’ Wednesday morning.

“But the growth and sale of contraband tobacco isn’t considered illegal in Kahnawake, who deem it a ‘constitutional right’ akin to hunting and fishing on other territories. Though his officers don’t intervene in tobacco-related arrests, chief ‘Peacekeeper’ Dwayne Zachary helped broker a compromise with the SQ…

“NASCAR driver Derek White, 45, was among the three Mohawk men arrested Wednesday. During a Sprint Cup Series race in New Hampshire last July, White became the first driver from a ‘First Nations’ territory to compete in NASCAR’s top level…

“The investigation, titled ‘Project Mygale’, started in the fall of 2014. A total of 700 police officers were involved on Wednesday.

“Gary Grant, a spokesperson for the ‘National Coalition Against Contraband Tobacco’, said the raids highlight how prominent the issue is in Canada.

“A lot of people over the years have discounted it as a victimless crime, as just a few people saving money on their taxes”, Grant said, “But when you see the types of results that have come from the raids you understand the seriousness of the problem.”

“With 40 years of experience with the Toronto police service, Grant said he wasn’t surprised to hear of the extent of the alleged criminal ring.

“The ‘Surete du Quebec’ (SQ) said Thursday its detectives were still searching for Jason Hill, 38, from Six Nations, an Iroquois community that sits about 40 km southwest of Hamilton, as part of the fallout from ‘Operation Mygale’.

“The SQ alleged Hill is connected to a biker gang-linked criminal network that imported about two million kilograms of U.S.-grown tobacco since 2014…

“…Hill is featured by the SQ in an organizational chart that identifies the Six Nations entrepreneur as the alleged buyer of tobacco from North Carolina farms.

“The contraband tobacco, which Hill allegedly arranged for purchase, was processed in Six Nations and in the Mohawk community of Kahnawake, which sits next to Montreal, and turned into cigarettes which were then sold on the black market for hefty margins, the SQ said.

“The RCMP estimates about 50 contraband tobacco manufacturers are operating on ‘First Nations’ territories in Ontario and Quebec, according to a briefing document sent to the federal public safety minister…

“The document, released under access-to-information legislation, states that dozens of organized crime groups — mostly in Central Canada — are involved in the distribution of illegal smokes and re-investing the profits they make into other crimes, including the trafficking of illicit drugs and firearms and human smuggling…

“There are also an additional 10 manufacturers on the U.S. side of the Akwesasne Mohawk ‘territory’, which straddles the borders of Ontario, Quebec and New York State, “giving rise to jurisdictional and legal challenges between federal, provincial and state laws,” the document states.

“The document says that organized crime groups are exploiting these jurisdictional challenges and that a 2012 ‘Criminal Intelligence Service Canada’ national threat assessment identified at least 58 organized crime groups involved in the illegal tobacco trade across the country — 35 of them in Central Canada.

“The manufacture and distribution of this illegal commodity fuels the growth of organized criminal networks, and the availability of this illegal commodity results in losses of federal and provincial taxes and excise duties and undermines significant government investment and public health objectives”, the document states.”

“The infiltration now of outside influence and forces and organized crime — gangsterism as they call it — it really can’t be denied,”

Chief Delisle said in an interview…

“…In the smoke shops of Kahnawake…nobody was too worried about the tough talk from Ottawa.

“It’s none of Quebec’s business or Canada’s business. We don’t bother them”, said one seller, who insisted on anonymity. “They’re supposed to stay in their canoe and we stay in ours, and we don’t cross over.”

“Like others in the trade, he predicted that any enforcement action by outside police would end badly.

“There’s no tension right now, but if there is, there are going to be funerals on both sides, off the reserve and on the reserve.”

“The 1990 Oka crisis, which left one provincial police officer dead at nearby Kanesatake and prompted a lengthy Mohawk blockade of the Mercier Bridge next to Kahnawake, is never far from authorities’ minds when considering how to tackle crime here.

“Two years before Oka, an RCMP raid on Kahnawake tobacco vendors led to 17 arrests and the seizure of $450,000 worth of tobacco products. It also triggered a 29-hour armed standoff when, in retaliation, Mohawks blocked highways through Kahnawake.

“SINCE THOSE CLASHES, THE CIGARETTE TRADE HAS BEEN LEFT TO GROW UNFETTERED…

“…Some of the cigarettes are being produced in facilities on Kahnawake, but the RCMP says most come from illicit manufacturers on the U. S. side of the Akwesasne Mohawk reserve, which straddles the borders of Ontario, Quebec and New York State…

“John Stacey, the owner of ‘Kahnawake Tobacco Manufacturing’, said the federal and provincial governments have no business trying to regulate the native tobacco trade, even if almost all his customers are non-natives.

“Everything we do, they want their cut, and they want us to ask permission. That’s not the rules over here.”

“He portrays the Mohawk tobacco trade as deeply rooted and integral to the Mohawk identity.

“Indians and tobacco are like oil and Arabs”, he said. “To us the plant is sacred.”

“Mr. Delisle, the Grand Chief, recognizes that something needs to be done to control the current tobacco free-for-all. At the moment, anybody on the reserve can open a smoke shack and sell cigarettes.

“Rules, he said, would have to be set and enforced by the aboriginals themselves…

“If [outside governments] have identified now for 25 years that the majority of the problem rests in ‘First Nations’ ‘territory’, why can’t they formally understand that the majority of the answers must rest in ‘First Nations’ ‘territory’, as well?” he asked.” {???}

http://www.first-nations.info/native-tobacco-trade.html“Because they don’t recognize taxation jurisdiction on reserves, there is nothing much to be done to force them to collect tax from non-native buyers on reserves. It’s when the smoke shack is located on non-reserve land — often referred to as ‘disputed territory’ — that the problem manifests itself, and tax-free cigarettes become contraband cigarettes, defined as any tobacco product that does not comply with the provisions of applicable federal and provincial statues, including payment of duties and taxes. Status card-carrying natives still buy their smokes tax free, but anyone else who buys from these vendors owes tax to governments.

“Again, native sellers ‘don’t recognize’ taxation authority, so they’re not about to start demanding taxes be included on the smokes they sell, even if the smoke shack in question sits on land not legally determined to be native-owned. Their attitude is that the taxes owing are not their problem, and if the governments want their share, they can collect the money…

“…The federal government, which has overall responsibility for native affairs, presumably does not want to provoke a confrontation over smoke shacks on disputed territory, for fear the outcome might resemble Oka or Ipperwash {Government cowardice, resulting in a refusal to do their jobs and enforce the law…}. In the absence of that political will, the provincial government, which has responsibility for law enforcement, can’t really act in isolation of its federal partner and shut down the offending vendors…

“…one way or the other, governments and law enforcement agencies need to make a dent in the sale of contraband tobacco. To do otherwise would be tantamount to endorsing the double standard that now exists, where legal vendors are being penalized because they can’t meet the price-point of sellers who don’t have to collect taxes. The status quo is not acceptable.”

“An Ontario ‘First Nation’ has raised the spectre of violence if the government goes ahead with a bill that would crack down on contraband tobacco.

“Tobacco is big business in ‘Six Nations’, just outside of Brantford, Ontario.

“But some of that cigarette trade is not up to snuff, and the ‘First Nation’ says the government’s ‘Bill C-10’ appears to be an excuse to butt into its business.

“It’s that old great-white-father attitude of ‘we know best’,”

said Chief Ava Hill, who said ‘First Nations’ have not been consulted during the process.

“If the bill passes,

“I can’t guarantee that there isn’t going to be some violence”, Hill said {‘threatened’}. “We’re hearing about that in the community.”

“Local MP Phil McColeman has said the government is not targeting legitimate tobacco operations, but only what it considers illegal trade, regardless of where in Canada it’s happening.

“I’m not a person who says ‘because you live on a ‘First Nation’ territory, you can break the laws of Canada.”

“But even if the government doesn’t step into ‘Native territory’ to enforce such a law, the effects could be crippling for a reserve that counts on visitors from all over southern Ontario {illegally} buying their tax-free smokes.

“They want to nab people as soon as they leave the territory”, Hill said, “which undermine the ‘rights’ and {criminal} economic development of the ‘First Nation’.”

“In the last 25 years, hundreds of Mohawks have been arrested and convicted for smuggling everything from home heating oil to drugs. The ‘Warrior Society’ denies that smuggling untaxed cigarettes into Canada is smuggling, because such actions are “legal” within the Mohawk ‘Nation’.

“They claim that they are not criminals because Canadian and American law does not apply to them. Yet, they know perfectly well that they move cigarettes through their territory, back into Canada to circumvent Canadian tax laws. While the leading ‘warriors’ operate within their territory, they have created an underground business in smuggling for the sole purpose of evading taxes. This business fuels their political agenda…”

“In Kahnawake, before the Oka Crisis, profits from the cigarette industry built a $3.2 million bingo hall, while taxpayers paid for the $4 million survival school which helps preserve the Mohawk heritage…

“Glen Styres owns 10 cigarette stores and a brace of gas stations. He allegedly trades cigarettes into Niagara Falls and London. Anne MacNaughton is reported to have been taking advantage of her duty-free status for business purposes since the 1960s. The two of them own a number of outlets and all of them have been diversifying into other activities since 1988. The MacNaughtons broke ground for a shopping plaza on Six Nations in 1988, the very day after the police in Cornwall made their first major arrests of native contraband-runners. Most Iroquois are, at best, neutral about the activities of the tobacco millionaires. They call them the “Silk Shirts”, or simply, “Silks”.

“The tobacco millionaires, like the Warrior’s Society, are brazen in playing upon sympathies and adopting tradition. Anne MacNaughton often describes herself to reporters as a Clan Mother — one of the 25 Iroquois matriarchs who select the chiefs. She also claims that her son Alan is a chief. This conveys tremendous respectability with impressionable whites… Anne is not telling the truth. Her sister has the hereditary right to be a Clan Mother, Anne does not and Alan is not a chief. Alan runs a video store in the MacNaughton plaza…

“Another Silk is Mark Maracle… At a November 1991 conference on Native Rights, he impressed many in the Canadian Left with the intensity of his anger and the depth of his feeling for the long-suffering Canadian Native:

“We as a people have to stand-up and grab a hold of our destiny by any means necessary… The only thing the white man recognizes is power. The only time they take notice is when we stand up and point a gun at them.”

“Maracle has begun his stand against the white man by telling his Iroquois neighbours that he will shoot them if they annoy him on his land. In a Globe and Mail interview in September 1993, Maracle underscored his determination to keep any authority at bay by showing the reporter a loaded AK-47 he keeps at hand…”

“… Canadian law enforcement seizures of contraband tobacco routinely include high-powered weapons, hard and designer drugs, stolen vehicles and other merchandise, and lots of cash…

“Contraband tobacco is lucrative — it is produced and trafficked systematically alongside other illicit goods, and Canadian crime syndicates are heavily invested in its proceeds…

“Compared to illicit drugs, materials and manufacture are readily accessible, and the market for contraband tobacco and cigarettes is huge, highly profitable and easy to reach. The loss factor is minimal because chances of detection are small, penalties lenient (if any are imposed at all), and social stigma less than for alternative illicit activities.

“Canada’s contraband market in tobacco and cigarettes is estimated at more than $1.3 billion, which rivals the narcotics market. In Ontario alone, the illicit cigarette market is roughly $500 million annually and forgone tax revenue between $1.6 billion and $3 billion… Between January 2007 and June 2008, the untaxed sales of cigarettes to non-Natives on reserves (not through informal distribution channels) is estimated to have resulted in $286.4 million of lost federal and provincial tax revenue, including $171.5 million lost by Ontario alone…

“are almost entirely supplied by criminal organizations that obtain their products mainly from ‘First Nations’ communities in Ontario and Quebec” (RCMP 2012b, 1).

“…Studies have repeatedly shown that Canadian contraband tobacco sales are overwhelmingly concentrated in Quebec and Ontario…

“A report by the ‘Canadian Taxpayer’s Federation’ (CTF) suggests that a substantial portion of cigarettes sold untaxed on reserves as part of their allocation quota – which is designated solely for Native personal consumption – are in fact sold to non-Natives without collecting provincial taxes.

“Drawing on a comparison of allocation quota sales and smoking rates on reserves, the study projects that as little as 21% of allocation cigarettes sold on Ontario reserves in 2011 were consumed legally. Smoking rates on reserves would have to be up to 466% of current estimates if Status Indians purchased all allocated cigarettes for personal use (Fildebrandt, 2012)…

“ A significant portion of untaxed tobacco in Canada also appears to be produced on reserves, but sold through off-reserve distribution networks… an earlier study by the ‘Canadian Tobacco Manufacturers’ Council’ found that loose cigarettes (or baggies) purchased off-reserve accounted for 62% of illegal sales…

“Residents employed in cigarette factories make at least $15/hour and between $100–$150 a day to bag cigarettes, and $175–$200 per day or $600–$700/week (tax free) tending to machines (Marsden 2009)…

“Two major sources of contraband dominate the Canadian market. The first is tobacco smuggled through, and usually produced on, reserves in Ontario and Quebec. The RCMP have identified four such manufacturing or distribution hubs of untaxed tobacco: Akwesasne near Cornwall, Ontario; Kahnawake near Montreal, Quebec; Tyendinaga near Belleville, Ontario; and Ohsweken (Six Nations) near Brantford, Ontario {ALL Mohawk reserves, ALL home to the ‘Mohawk Warriors’ criminal gang}…

“But only so many people will drive onto a reserve to purchase cigarettes, and the ones who do are often locals, anyway; so, manufacturing reserves have a distribution problem. “Wholesalers” are needed to bring large quantities of product to market in large population centres and other reserves. This distribution step is completely illegal and usually performed by organized crime, which isolates aboriginal production from risk. Distribution and retail hubs include Kanesatake near Montreal, Wendake and Kitigan Zibi north of Gatineau, Quebec, and Listuguj on the New Brunswick/Quebec border…

“…veteran cigarette smuggler Al Jacobs of ‘Jacobs Tobacco’ on reserve is infamously known as the “40-million-dollar man”. This has engendered a

“narco-culture…in which the traditional values of humility, compassion, simplicity, generosity and communal service have been replaced by violence, intimidation, greed and death… The easy money has led to corruption not only at Akwesasne but throughout the region” (George-Kanentiio, 2008).

“…Aboriginals on reserves defend their right to manufacture, trade, and sell tobacco products and will likely continue to do so in defiance of federal and provincial governments, especially as long as Canadian law enforcement effectively shuns enforcement on reserves…

“… it is clear that Akwesasne, and to a lesser extent Kahnawake and other area reserves, are serving as enclaves of crime and convenience for organized crime. They do not exploit these territories only for tobacco; were the North American aboriginal tobacco industry to disappear tomorrow, these reserves would still be used by syndicates to smuggle and store illicit wares. Ergo, policies that are effective in combating organized crime more generally will be effective in curtailing cigarette smuggling…

“Contraband tobacco had not been mentioned specifically in the ‘Criminal Code’ prior to the passage of ‘Bill C-10’ in 2014. It adds a new section (121.1) to Part IV of the Criminal Code that

“prohibits different steps involved in the selling of tobacco products that have not received an excise stamp or of raw leaf tobacco that is not packaged, unless it is stamped.”

“This statute applies when tobacco is intended for resale (purchase of contraband tobacco for personal use is not punishable under the Criminal Code). The Act does not mention the manufacture or purchase of tobacco, which are addressed by the ‘Excise Act’. Changes thus address the sale of untaxed tobacco.

“However, an illegal manufacturing facility that sells tobacco without paying federal excise taxes and/or used unstamped raw leaf could be charged under this Act’s amendments, especially since federal excise taxes are paid by the manufacturer at the time of packaging. Bill C-10 also leaves open the potential of a major expansion of enforcement against contraband tobacco: All Canadian police forces can enforce the provisions of the Criminal Code; by convention, only the RCMP makes enforcement of the Excise Act a priority…

“Punishment can be by either an indictment or a summary offence. Maximum penalties of up to five years’ imprisonment for an indictment, or six months for a summary conviction, can be levied. Similarly, maximum penalties for contravening sections of the Excise Act concerning the possession and sale of unstamped raw leaf or processed tobacco products are five years’ imprisonment for an indictment and 18 months’ imprisonment for a summary conviction. Bill C-10 also institutes mandatory minimum sentences for repeat offenders. The Excise Act only stipulates mandatory minimum fines. In Ontario, for instance, fines range from $108 for a single pack of contraband cigarettes to $4,693 for 50 cartons or baggies. The problem with fines is that smugglers notoriously do not show up for court and fail to pay fines amounting to hundreds of thousands of dollars, yet are rarely if ever imprisoned for contempt or failure to pay…

“…The legislation opens the opportunity for the federal government to emerge as the central coordination authority of a unified taxation structure for all Canadian peoples, across provinces and reserves…

“Quebec has negotiated an exempt status of Indians from provincial taxes with the Mohawk Council of Kahnawake, implemented “smart cards” that allow for tax-free cigarettes purchases off-reserve by Kahnawake residents, and established the remittance of provincial taxes collected from non-Native customers back to the band council.

“However, the ‘Kahnawake Tobacco Association’, a compact of different tobacco manufacturers and wholesalers on the reserve, promptly ignored the deal, citing its ‘aboriginal right’ to defy the provincial government, as it is not a member to any treaty with the people of Kahnawake and thus has no jurisdiction on-reserve. This action effectively incapacitated the agreement, which federal, provincial, or on-reserve law enforcement have been unable to enforce…

“Greater effort across the borders of the Cornwall-Valleyfield region, as well as the main ports (and points) of entry for loose tobacco on the New York/Vermont/Quebec border would likely put a significant dent in the supply of untaxed tobacco from these reserves. Yet, for complex legal, historical, and cultural reasons, enforcement of federal and provincial tobacco tax laws by the RCMP and provincial forces has been intermittent on Native reserves.

“IN THEORY, NOTHING STOPS GOVERNMENT FROM ENCIRCLING RESERVES AND/OR ENTERING THEM TO ENFORCE THE LAWS against the will of Native governments. The fundamental obstacle to such a crackdown are the ghosts of Gustavson Lake, Ipperwash, and Oka…

{In other words, aboriginals have effectively driven away law enforcement by being violent enough (!?!)…}

“Since the 1970s, ‘First Nations’ have been able to set up their own police forces… Little research has been done on ‘Native policing’ and ‘peacekeeping’ forces in Canada… They are averse to confrontation with the very communities they serve… Their mandate tends to be community stability (keep the peace), not full-spectrum law enforcement (the “white man’s” regulations and laws)…”